I've seen data (and I wish I could remember where) showing that over 90% of the new hoime buyers over a recent period of years made no down payment whatsoever. If this is true (and I suspect it is), if those homeowners face foreclosure, their only real loss is the monthly mortgage payments they made--i.e. rent.

A major problem is that the banks don't want to foreclose--because the real estate market is shot, and they can't sell the collateral.